Efficiency, Technological Progress and Regional Comparative Advantage: A Study of Organised Manufacturing Sector in India

Dipa Mukherjee (medipa@rediffmail.com) and Rajarshi Majumder

MPRA Paper from University Library of Munich, Germany

Abstract: Technological upgradation and increasing capital intensity in organised manufacturing sector in India has been championed on grounds of improving productivity, efficiency, and competitiveness. In a developing economy this is a costly proposition due to capital scarcity, and the effect of technological changes on productivity and efficiency levels have to be estimated before taking such policies. This paper seeks to estimate trends in Factor Productivity, Technological Progress, and Technological Efficiency in this sector and examines their relative importance also. Technical Efficiency is observed to be moderate and further declining in the nineties. Substantial disparity exists among regions and product groups regarding Efficiency, Technical Progress and Efficiency changes. It is found that increasing capital intensity has been associated with falling productivity, efficiency, and technological deceleration in the nineties. Wider diffusion rather than greater capital use is thus recommended for productivity rise. Regional efficiency matrix is also prepared so that states can focus on specific areas where they have comparative advantages.

Keywords: Productivity; Technical Efficiency; Technological Progress; Organised Manufacturing; Diffusion; Regional Comparative Advantage (search for similar items in EconPapers)
JEL-codes: D24 E23 L60 O33 R11 (search for similar items in EconPapers)
Date: 2008
New Economics Papers: this item is included in nep-cse, nep-cwa and nep-eff
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